Whether public interest is at all protected by a particular PFI contract is highly dependent on how well or badly the contract was written and the determination or not and capacity of the contracting authority to enforce it.
The banks who fund PFI projects are repaid by the consortium from the money received from the government during the lifespan of the contract.
Under a private finance initiative, the private company handles the up-front costs instead of the government. If standards do not improve after an agreed period, the public sector authority is usually entitled to terminate the contract, compensate the consortium where appropriate, and take ownership of the project.
Private finance initiative pdf
It should be updated regularly throughout the procurement process, taking account of any changes in scope to the project, to provide a genuine comparator to any private sector bids and thus help ensure that the procurement route offering the best VFM is chosen. DoF's Central Procurement Directorate CPD can provide detailed guidance on the procurement options that are available, and how to conduct the relevant procurement process. The following paragraphs expand on what this means in practice. The advice of CPD or , if appropriate, another designated centre of procurement excellence CoPE , must be sought regarding the appropriate bid evaluation criteria to use and how to apply them. It immediately proved controversial, and was attacked by the Labour Party while in opposition. PFIs eliminate the burden of coming up with the capital for these projects from the government and taxpayers. Governments repay private firms over time with interest. It is sensible to consider ranges around these estimates, to avoid spurious precision. The framework also lists various sources of guidance that are relevant in Northern Ireland. Private sector firms may also be contracted to construct water and wastewater facilities, prisons, public schools, arenas, and sports facilities. Termination procedures are highly complex, as most projects are not able to secure private financing without assurances that the debt financing of the project will be repaid in the case of termination.
The bids received from private firms responding to the invitation to tender will usually present a number of options for appraisal. They are used to fund major public works projects such as schools, prisons, hospitals, and infrastructure. It also helps to provide additional reassurance where there is limited experience of PPP in the area of activity under consideration; or when there are relatively few bidders and hence competition cannot be relied upon to ensure VFM.
PFI and PPP both have very similar characteristics, the key difference being the way in which the relevant project is funded. The FBC's purpose is to inform the final decision on the project and provide a basis for approval to proceed to the award of a contract. SPVs often charge fees for this go-between 'service'.
based on 7 review